Buffet holds $160 bln in cash; China nationalises Anbang; China dominates fishing; OECD alarmed by sovereign debt; trade up strongly; UST 10yr at 2.87%; oil up and gold down; NZ$1 = 72.9 USc; TWI-5 = 74

Here's our summary of key events over the weekend that affect New Zealand, with news that global trade is growing quickly.

But first, the US Fed has issued its semi-annual report to Congress and they see a quickly improving economy, one on inflation watch however.

And Warren Buffet also had a good year at Berkshire Hathaway in 2017. His widely-read annual letter says he is on the lookout for some really bid deals for his almost NZ$160 bln cash reserves. (Yes, that is cash reserves of more than 40% of New Zealand's annual GDP. And that will be added to by almost +NZ$40 bln from the Trump tax cut.)

In Canada, inflation rose +1.7% on a year-on-year basis in January, following a +1.9% increase in December. The January level was higher than analysts were expecting.

China has nationalised one of its largest insurance companies and placed its bosses under arrest and who have been accused of 'economic crimes'.

China’s house prices grew in January, up by +5.0% from the same month in 2017, although major cities saw early signs of softening, as the government continued its efforts to rein in speculative demand to fend off bubble risk.

Data out for 2016, the latest available, shows China accounted for 17 mln out of the 40 mln hours of fishing observed globally in 2016, compared with just over 2 mln hours each for Taiwan, Spain and Italy, the next three biggest fishing economies.

Germany (its Federal government and the country's 16 states and its communities) posted a budget surplus of €36.6 bln (NZ$61.7 bln) in 2017. This is the fourth annual surplus in a row and came as their economy expanded by +2.2%, the largest annual growth since 2011.

And staying in Europe, the major Latvian bank facing American sanctions for allegedly helping North Korea evade sanctions will be wound up under local laws after the ECB declared it “failing or likely to fail.”

In a new Report, the OECD is sounding the alarm about how much countries are borrowing. They say members’ total sovereign debt has increased from US $25 tln in 2008 to more than US $45 tln as politicians get to think that debt will always be cheap. But the OECD is warning that debt servicing, especially if inflation rises, will hit budgets hard.

And international trade flows recovered strongly in 2017 to grow at their fastest pace since 2011. A new analysis said that the volume of exports and imports of goods was +4.5% higher than in 2016, marking a pickup from the +1.5% rate of expansion in the preceding year, which was the lowest since the global financial crisis. The 2017 growth was above the average since 2000 (+3.6%), but well below the average from 2000 to 2007 of +6.9% growth.

In New York, the UST 10 yr yield ended the week at 2.87%, a small pullback from the strong rise following the release of the US Fed minutes.

The gold price is down -US$2 to US$1,328/oz.

Oil prices are up today by more than +$US1, with the US benchmark now just over US$63.50/bbl and the Brent benchmark under US$67.50/bbl. And speaking of oil, S&P has upgraded Russia's sovereign credit rating to investment-grade BBB- from its previous junk status of BB+ which it has had for the past three years.

The Kiwi dollar will start softer this morning at 72.9 USc. On the cross rates we are lower at 93 AUc and holding at 59.3 euro cents. That puts the TWI-5 at 74.

Bitcoin is still under US$10,000 and now at US$9,338. That is a -5% fall from this time on Friday.

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The easiest place to stay up with event risk today is by following our Economic Calendar here ».